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Metals morning view: Metals prices consolidate after Thursday’s rebounds

Fri, 02/23/2018 - 08:16

The base metals complex on the London Metal Exchange is mixed this morning, Friday February 23, with prices down by an average of 0.2%. Zinc prices lead the decline with a 0.8% fall to $3,501 per tonne, copper and nickel prices are off by 0.4% with the former at $7,143 per tonne, aluminium prices are bucking the trend with a 0.4% rise, while the rest are little changed.

Volume has returned to around average with 7,917 lots traded as of 06:56 am London time.

This follows a day of recovery on Thursday when prices dropped intraday before rebounding in the afternoon, which has left underlying tails on most of the metals’ candlestick charts.

Gold prices are weaker this morning, with prices off 0.4% at $1,326.53 per oz, silver and platinum prices are little changed and palladium prices are up by 0.2%. This follows a day of strength on Thursday, when gold, silver and platinum closed up between 0.3% and 0.5% and palladium closed up 1.8%.

On the Shanghai Futures Exchange, the base metals are for the most part stronger this morning, with gains averaging 1.1%. At the extremes nickel prices are up by 2.1% and tin prices are down by 0.1%, while copper prices are up by 1.6% at 53,620 yuan ($8,448) per tonne. Spot copper prices in Changjiang are up by 1.5% at 52,940-53,120 yuan per tonne and the LME/Shanghai copper arbitrage ratio stands at 7.51.

In other metals in China, iron ore prices are up by 2.0% at 548.00 yuan per tonne on the Dalian Commodity Exchange. On the SHFE, steel rebar prices are up by 1.5%, while gold prices are up by 0.35 and silver prices are up by 0.5%.

In wider markets, spot Brent crude oil prices are up by 0.11% at $66.24 per barrel, the yield on US 10-year treasuries has eased to 2.92%, as has the German 10-year bund yield which was recently quoted at 0.70%.

Equity markets in Asia are stronger across the board this morning: Nikkei (+0.72%), Hang Seng (+1.13%), CSI 300 (+0.45%), ASX 200 (+0.82%) and Kospi (+1.54%). This follows gains in western markets on Thursday, where in the United States the Dow Jones closed up by 0.66% at 24,962.48, and in Europe where the Euro Stoxx 50 closed up by 0.05% at 3,431.99.

The dollar index’s rebound ran out of steam yesterday and is consolidating this morning at around 89.99. This is leading to consolidation in the other currency majors: euro (1.2286), sterling (1.3931), yen (107.07) and Australian dollar (0.7817). The yuan is fairly flat at 6.3417 – before the Lunar New Year holiday it was around 6.3440 – and the emerging market currencies we follow are also consolidating.

On the economic calendar there is data on German final GDP, which came in unchanged at 0.6%, later there is EU CPI, China leading indicators and the Federal Reserve’s monetary policy report. In addition, UK’s Monetary Policy Committee member David Ramsden and Federal Open Market Committee members William Dudley, Loretta Mester and John Williams are speaking.

Thursday’s intraday price dips on the base metals that were followed by strong rebounds implies good bargain hunting interest, even if there is not yet much interest to chase prices higher. As such, we may well see prices hold up in high ground for longer while traders adjust and get more used to these price levels, before the rallies extend further.

The down draft in gold prices seems to have halted now that the dollar’s rebound is paused. For now we would expect further consolidation, but we expect the general bullishness in metals to lead prices higher again before too long. We expect dips to remain well supported.

Overnight Performance GMT 06:56 +/- +/- % Lots Cu 7,143 -27.5 -0.4% 3,163 Al 2,195 9.0 0.4% 1,141 Ni 13,765 -55.0 -0.4% 1,124 Zn 3,501 -29.0 -0.8% 2,170 Pb 2,553 1.0 0.0% 295 Sn 21,440 -45.0 -0.2% 24 Average BM   -0.2%        7,917 Gold  1,326.53 -4.02 -0.3%   Silver        16.56 -0.02 -0.1% Platinum      995.00 0.00 0.0% Palladium  1,040.00 2.00 0.2% Average PM   -0.1%

 

SHFE Prices 06:55 GMT RMB Change % Change Cu      53,620           850 1.6% AL      14,340           190 1.3% Zn      26,620           210 0.8% Pb      19,405           175 0.9% Ni   105,050        2,140 2.1% Sn   147,600 –         210 -0.1% Average change (base metals) 1.1% Rebar  3,940.00        59.00 1.5% Au      274.60          0.75 0.3% Ag  3,697.00        20.00 0.5% Iron Ore (DCE) May’18 548 10.5 2.0%

 

Economic calendar GMT Country Data Actual Expected Previous 7:00am Germany German Final GDP q/q 0.6% 0.6% 0.6% 10:00am EU Final CPI y/y 1.3% 1.3% 10:00am EU Final Core CPI y/y 1.0% 1.0% 12:00pm UK MPC Member Ramsden Speaks 2:00pm China CB Leading Index m/m 1.7% 3:15pm US FOMC Member Dudley Speaks 4:00pm US Fed Monetary Policy Report 6:30pm US FOMC Member Mester Speaks 8:40pm US FOMC Member Williams Speaks

 

The post Metals morning view: Metals prices consolidate after Thursday’s rebounds appeared first on FastMarkets.

Categories: Metals Industry News

SHFE base metals all higher as market gears up after holidays

Fri, 02/23/2018 - 02:46

Base prices on the Shanghai Futures Exchange (SHFE) rose across the board during Asian morning trading on Friday February 23, the second trading day after Lunar New Year holidays.

The May nickel contract on the SHFE stood at 104,880 yuan ($16,543) per tonne as of 10.00 am Shanghai time, up by 2,040 yuan – or 2% – from the previous session’s close of 102,840 yuan per tonne.

“There is still a lot to like about nickel, which is starting to recover meaningfully from a very low base. It has embarked on an upward trend amid the rising profile of electric vehicles (EVs), which gives a bullish outlook for global nickel consumption,” according to Metal Bulletin analyst Andy Farida.

“Meanwhile, uncertainty continues to dog the sector, which reflects a lack of resolution about environmental policies – 13 of 30 nickel mines reported zero production during the year. Indonesia nickel ore producers are likely to replace the lost output from material the Philippines after the relaxation on its export ban,” according to Farida.

The most-traded SHFE April copper contract price stood at 53,530 yuan per tonne, up 780 yuan – or 1.5% – compared with the previous session’s close of 52,750 yuan per tonne, following stronger LME copper prices.

The three-month LME copper price increased $43 to $7,162 per tonne during the previous trading session. Stocks declined a net 2,500 tonnes to 334,675 tonnes, with 10,800 tonnes freshly cancelled.

Meanwhile, HudBay Minerals reported strong revenue and profits during 2017, notably due to higher-than-expected copper output and and solid zinc production.

SHFE base metals all up 

  • The SHFE April aluminium contract price increased 210 yuan, or 1.5%, to 14,335 yuan per tonne.
  • All eyes are on the recommendations from the Section 232 report, released last Friday. US President Trump has a deadline of April 19 to impose any one of the US Department of Commerce’s recommendations, which is causing heightened uncertainty.
  • The SHFE April zinc contract price was up 340 yuan, or 1.3%, at 26,670 yuan per tonne.
  • The SHFE April lead contract price increased by 75 yuan, or 0.4%, to 19,370 yuan per tonne.
  • The SHFE May tin contract price rose by 100 yuan, or 0.1%, to 147,280 yuan per tonne.

Currency moves and data releases

  • The dollar index decreased by 0.03% to 89.82 as of 10.38am Shanghai time.
  • In other commodities, the Brent crude oil spot price was up by $0.26 at $66.43 barrel as of 10.38am Shanghai time.
  • In equities, the Shanghai Composite was up by 0.7% at 3,291.38 as of 10.40am Shanghai time.
  • In yesterday’s data, the US weekly unemployment claims came in at 222,000, 8,000 below the expectations of 230,000. Later, the CB leading index, natural gas storage and crude oil inventories are all slated for release.
  • In data today, EU CPI readings and the CB leading index of China are due out, while US FOMC member William Dudley and Loretta Mester are speaking.

The post SHFE base metals all higher as market gears up after holidays appeared first on FastMarkets.

Categories: Metals Industry News

2018 a ‘turning point’ for zinc concs market; TCs to rebound – Nyrstar CEO

Thu, 02/22/2018 - 14:45

Nyrstar places the zinc concentrate market at a “turning point” and expects treatment charges (TCs) to increase in 2018, chief executive officer of Nyrstar, Hilmar Rode, said in a conference call after the company released its annual results today.

Zinc concentrate spot treatment charge (TC) CIF Asia Pacific, $/tonne Lower TCs and conservative hedging arrangements weighed on Nyrstar’s 2017 profits, which rose just 5% on an annual basis to €206 million ($253.74 million) in 2017 despite a 38% surge in the average zinc price, according to Nyrstar’s results report.

The London Metal Exchange 3-month zinc price increased 29.1% over 2017, from $2,567.50 per tonne on January 2 to $3,316 per tonne on December 29 (the first and last working days of the year).

Nyrstar, which mines zinc for internal processing and purchases concentrates on a spot and annual contract basis, achieved an average TC for total purchased tonnes of $40 per tonne below the $172 benchmark level agreed for 2017.

“We see no reason for that $40 per tonne discount to the benchmark to change,” Rode said of the 2018 TCs negotiation. “We do believe the zinc industry is approaching a turning point in the TC cycle, so we expect TCs to start increasing during 2018,” Rode added.

Rode’s comments come while annual zinc concentrate supply contract negotiations are underway, with smelters refusing to accept a slash in TCs and arguing that the mine supply deficit in previous years is switching to a balance.

“That means in terms of TCs that bargaining power will start to transfer from the miners to the smelters,” Rode said.

Industry sources told Metal Bulletin some initial offers for smelters are as low as $90 per tonne, representing a sharp cut of 50% from the 2017 level , citing uncertain mined zinc supply.

Miners and smelters were said to be closer to reaching an agreement with terms in a $140-155-per-tonne range during negotiations, according to participants at the IZA conference last week.

“We do not see some of the views, in terms of earlier offers the mine made us, as coming to pass. We are pretty confident.” Rode said.

Spot zinc TCs sank to multi-year lows at a $10-30 per tonne level, cif Asia Pacific, amid Chinese smelters’ increase in January orders, according to Metal Bulletin’s assessment at the end of last month, which represented a $10 drop due to an extremely tight market.

Last year, Nyrstar, Europe’s largest zinc producer, generated 1,019,000 tonnes of zinc metal. This was flat year on year due to the unusual heavy maintenance schedule and unplanned outages at Budel and Hobart.

Meanwhile, its mined zinc output surged 28% to 123,000 tonnes following the restart of Middle Tennessee, which aims to attract would-be buyers.

In 2018, Nyrstar’s output of zinc metal is expected to rise to 1,050,000-1,100,000 tonnes and mined zinc output should hit 160,000-180,000 tonnes.

Its protective hedging arrangement, which applies to 70% of its free metal output, also prohibited Nyrstar from fully capitalizing on the 38% gains in the average zinc price in 2017.

The post 2018 a ‘turning point’ for zinc concs market; TCs to rebound – Nyrstar CEO appeared first on FastMarkets.

Categories: Metals Industry News

Metals morning view: Metals sell off as China returns from holiday

Thu, 02/22/2018 - 09:00

The metals prices on the London Metal Exchange on Thursday February 22 are down an average of 1.6%, with nickel prices down the most with a 2.3% decline to $13,460 per tonne and copper prices off 1.6% at $7,024 per tonne.

With China back at work after the Lunar New year holiday, volumes on the LME have been high with 16,127 lots traded as of 07:32 am London time.

Wednesday’s trading had seen some strength ahead of China’s return to work, with copper, aluminium, nickel and tin closing up by an average of 1.2% – although lead and zinc closed down an average of 0.7%. This morning’s performance suggests Chinese traders have returned  to seefirmer prices and have sold into them.

Precious metals prices are for the most part weaker, with gold, silver and platinum prices off an average of 0.4%, while palladium prices are up 0.1%. The firmer dollar is no doubt weighing on sentiment.

In wider markets, spot Brent crude oil prices are weaker by 0.28% at $64.84 per barrel and the yield on US 10-year treasuries remains firm at 2.94% as US treasury auctions are underway, and the German 10-year bund yield has firmed to 0.73%.

In equity markets, China has returned on a positive footing with the CSI 300 up 2.16%. Elsewhere, the ASX 200 is up 0.12%, while the Nikkei is down 1.07%, the Hang Seng is off 1.31% and the Kospi is down 0.63%. This follows a weaker performance in western markets on Wednesday, where in the United States the Dow Jones closed down by 0.67% at 24,797.78, and in Europe where the Euro Stoxx 50 closed down by 0.14% at 3,430.16.

The dollar index’s rebound continues, it was recently quoted at 90.16, the fifth consecutive day of gains. This is applying some downward pressure on other currencies, with the euro at 1.2271, sterling at 1.3882 and the Australian dollar at 0.7796. But the yen’s slide had halted – it was recently quoted at 107.40, having touched 107.90 yesterday. The yuan has dropped to 6.3616 – before the Lunar New Year holiday it was around 6.3440 – and the emerging market currencies we follow remain on a back footing, which reflects the slightly firmer dollar and concern over rising US treasury yields.

The economic calendar is busy today as it includes French CPI, the German Ifo business climate, UK data on GDP, business investment, index of services and CBI realized sales, with US data including initial jobless claims, leading indicators, natural gas storage and crude oil inventories. In addition, Federal Open Market Committee member Raphael Bostic is speaking.

The base metals are on a back footing this morning. The fact Chinese traders have not come back in a bullish mood suggests overhead resistance may prove difficult to overcome for a while. With yesterday’s PMI reading, ex-US weaker than January’s readings, the economic climate looks less bullish. But that said, with most readings above 55 – so well above the 50 divide -, the global economy remains in expansion mode and that is bullish for the outlook for metals demand. As such, we would let this weakness runs its course and see the dips as leading to buying opportunities.

Another turn around in the dollar has weighed on gold, especially as it has happened when gold prices are once again challenging recent highs. While the US treasury auctions have been underway, yields have remained bid and that has underpinned the dollar and weighed on gold. We wait to see what follows once the auctions are out the way. We expect dips to remain well supported.

Overnight Performance GMT 07:32 +/- +/- % Lots Cu 7,024 -111.5 -1.6% 3,988 Al 2,174 -33.5 -1.5% 3,869 Ni 13,460 -320.0 -2.3% 1,882 Zn 3,460 -75.5 -2.1% 5,534 Pb 2,526 -36.5 -1.4% 822 Sn 21,495 -110.0 -0.5% 32 Average BM   -1.6%      16,127 Gold  1,320.98 -5.17 -0.4%   Silver        16.43 -0.08 -0.5% Platinum      987.50 -2.50 -0.3% Palladium  1,021.50 1.50 0.1% Average PM   -0.2%

 

SHFE Prices 07:34 GMT RMB Change % Change Cu      52,760           200 0.4% AL      14,130 –         140 -1.0% Zn      26,325 –         155 -0.6% Pb      19,270             80 0.4% Ni   102,810           470 0.5% Sn   147,140 –      1,270 -0.9% Average change (base metals) -0.2% Rebar  3,862.00 –      72.00 -1.8% Au      273.85 –        1.15 -0.4% Ag  3,676.00 –      31.00 -0.8% Iron Ore (DCE) May’18 538.5 3 0.6%

 

Economic calendar GMT Country Data Actual Expected Previous  7:45am France French Final CPI m/m -0.1% -0.1% 9:00am Germany German Ifo Business Climate 117.1 117.6 9:30am UK Second Estimate GDP q/q 0.5% 0.5% 9:30am UK Prelim Business Investment q/q 0.5% 0.5% 9:30am UK Index of Services 3m/3m 0.4% 0.4% 11:00am UK CBI Realized Sales 13 12 12:30pm EU ECB Monetary Policy Meeting Accounts 1:30pm US Unemployment Claims 230K 230K 3:00pm US CB Leading Index m/m 0.7% 0.6% 3:00pm US FOMC Member Dudley Speaks 3:30pm US Natural Gas Storage -121B -194B 4:00pm US Crude Oil Inventories 2.2M 1.8M 5:10pm US FOMC Member Bostic Speaks

The post Metals morning view: Metals sell off as China returns from holiday appeared first on FastMarkets.

Categories: Metals Industry News

SHFE base metals prices down; China market back from holiday

Thu, 02/22/2018 - 07:12

Base metals on the SHFE were all down on the Chinese market opening after the one-week holiday.

The most-traded April copper contract on the SHFE stood at 52,660 yuan ($8,300) per tonne as of 12.37pm Shanghai time, down by 130 yuan from the previous session’s close.

A similar plunge was also seen in the most-traded April aluminium contract on the SHFE, which stood at 14,095 yuan – down 10 yuan from the previous session’s close. About 106,234 lots of the contract have changed hands so far.

The strong performance of US dollar has weighed on the red metal in the first trading day after the week-long Chinese New Year holiday.

The US dollar index has maintained a sustained rally since February 16, and hit as high as 90.229 at 15.06pm Shanghai time.

“The US dollar found its feet overnight rallying relatively broadly after finally breaking its unusual, negative correlation with US yields.” ANZ Research said.

In addition, the rising stocks also kept the copper prices subdued.

Before the Chinese New Year holiday started on February 15, the SHFE copper inventory increased by 11,627 tonnes – or 6.2% – to 197,759 tonnes in only three days as of February 14.

“China copper stocks may increase after the Chinese New Year holiday, and consumption won’t improve until mid-March,” Citic Futures Research said.

Meanwhile, the most-traded May nickel contract plunged 540 yuan to 102,950 yuan per tonne amid consolidation, with around 171,930 lots traded so far.

Other metals lower

  • The SHFE March zinc contract price eased by 350 yuan to 26,300 yuan per tonne.
  • The SHFE May tin contract price dived 1,190 yuan to 147,690 yuan per tonne.
  • The SHFE March lead contract slipped 65 yuan to 19,255 yuan per tonne.

Currency moves and data releases

  • The dollar index was down by 0.03% to 90.09 as of 12.37pm Shanghai time.
  • In other commodities, the Brent crude oil spot price was down by 0.25% to $64.86 per barrel as of 12.37 pm Shanghai time.
  • In equities, the Shanghai Composite was down by 2.06% to 3,264.75 as of 12.37 pm Shanghai time.
  • In the UK today, the CBI retail sales report and Q4 GDP data will be announced.
  • The ECB will release of the Accounts of its Jan 24-25 meeting.
  • Initial jobless claims are out in the United States and Canada releases retail sales figures.

The post SHFE base metals prices down; China market back from holiday appeared first on FastMarkets.

Categories: Metals Industry News

Glencore positive on copper, zinc, nickel amid EV optimism; 2017 net income jumps four-fold

Wed, 02/21/2018 - 10:00

Glencore is positive on the outlook for copper, zinc, nickel and cobalt amid optimism over growth in the electric vehicle (EV) market, while its net income jumped more than four-fold to $5.78 billion in 2017 on higher commodity prices.

Cobalt Low Grade MB free market $ per lb in warehouse Cobalt High Grade MB free market $ per lb in warehouse

“The electric vehicle upheaval continues to unfold, with the scale of market penetration and investment by battery and automotive manufacturers and infrastructure players, adjusting progressively upwards. This provides an additional dimension of future demand growth for a number of our key commodities,” Glencore said in its financial report released on Wednesday February 21.

Accelerating EV adoption requires an energy and mobility transformation that is forecast to unlock new sources of demand for commodities including copper, nickel and cobalt, it said.

An independent study, recently commissioned by Glencore, to gauge the potential demand for these commodities under the Electric Vehicles Initiative suggested an additional 4.1 million tonnes of copper, 1.1 million tonnes of nickel and 314,000 tonnes of cobalt supply will be required by 2030.

“These potentially significant new demand sources offer compelling fundamentals, particularly when coupled with persistent supply challenges,” Glencore said, while adding that its commodity mix is becoming less dependent on demand generated by infrastructure-related investment in developing markets.

Copper and cobalt 

Global copper supply is expected to be affected by ageing assets, limited sector reinvestment, a diminished project pipeline and an elevated risk of mine disruptions, Glencore said.

“With global economic growth pointing to healthy demand, the copper market is likely to remain in substantial supply deficit, which, if it occurs, will in turn result in further inventory drawdowns,” it said.

The emerging battery and EV trend adds further uplift to the demand outlook and attractive fundamentals. With copper and cobalt expected to play important roles across the value chain of the energy and mobility evolution, from power generation and distribution, to energy storage and vehicles, it added.

The company produced 1.31 million tonnes of copper in 2017 in total, down 8% or 116,100 tonnes from a year ago. Glencore expects a production volume between 1.435-1.495 million tonnes of copper for 2018, up 9.54-14.12% from 2017.

The London Metal Exchange three-month copper price has mostly held above $7,000 per tonne since late last year amid labor concerns in South America and a positive macroeconomic outlook. The contract closed at $7,090 per tonne on February 21.

Glencore is targeting a 42% increase in cobalt production this year, despite the fact that full-year production for 2017 was down 3% to 27,400 tonnes.

Cobalt prices have surged rapidly over the past year amid mounting anticipation and excitement over the prospects for its use in the production of EV batteries.

Metal Bulletin’s low-grade cobalt, in-warehouse price was assessed at $38-39.30 per lb on February 16, up around 70% from one year ago, while the high-grade cobalt, in-warehouse price was assessed at $38.20-39.40 per lb on the same day, also up close to 70% on an annual basis.

Zinc and nickel 

Higher zinc prices will incentivize higher concentrate production, easing treatment charges in the mid-term and eventually resulting in higher metal production. Yet, the environmental constraints in China and the slower-than-anticipated pace of mine restarts or new mine start-ups means that the current zinc tightness may remain for some time, Glencore said.

“As there is also a time lag before concentrates units convert into metal units, we expect the current strong pricing environment to be supported in the near to mid-term,” it said.

Glencore has kept its zinc production guidance unchanged for the 2018 financial year at around 1.09 million tonnes, matching actual production in 2017, despite the scheduled restart of its 100,000 tonnes per year Lady Loretta mine in the first half of this year.

The LME three-month zinc price had hit as high as $3,595.50 per tonne on February 15, the highest since July 2007.

On nickel, the market has remained in material supply deficit for a second year running, enabling global stocks to draw down quickly despite headline LME inventory suggesting otherwise, Glencore said.

Even with a conservative forecast for 2018 demand, the outlook is for continued sizeable deficits and further decreases in primary nickel stocks. Forecasted supply increases have been based on Indonesia exporting more nickel units in ore or nickel pig iron (NPI), with production elsewhere expected to be flat or fall, it added.

The LME three-month nickel price reached as high as $14,420 per tonne on February 15, the highest since May 2015, amid optimism over EV demand growth.

“Going forward, those commodities where primary market balances are in deficit or trending towards deficit, such as zinc, copper, nickel and thermal coal should see positive price divergence versus potentially oversupplied markets,” the company said.

Glencore’s net income attributable to equity holders jumped 319% to $5.78 billion, while its adjusted earnings before interest tax depreciation and amortization (Ebitda) grew 44% to $14.76 billion in 2017.

“After an encouraging end to 2016, which saw commodities recover from cycle lows, positive momentum continued through 2017, resulting in prolonged outperformance of Glencore’s key commodities versus the broader markets,” the company said.

Concerns of tightening financial conditions in China during the second quarter proved to be short-lived, with commodities rallying once again through the second half of the year, it noted.

A strong economic performance in both major developing and developed markets has underpinned supportive commodity demand conditions, while early signals of inflation and higher interest rates also bode well for commodities as an asset class, Glencore added.

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Categories: Metals Industry News

Metals morning view: Metals prices drift as market awaits China’s return

Wed, 02/21/2018 - 08:40

The metals prices on the London Metal Exchange are mixed this morning, Wednesday February 21, with nickel and tin prices firmer by 0.4%, while the rest are lower by between 0.1% and 0.5%. Copper prices are off 0.1% at $7,068 per tonne.

Volumes remain light with 1,862 lots traded as of 07:05 am London time – we expect this to change tomorrow with China returning from the Lunar New Year holiday.

Tuesday’s trading was for the most part weaker, with copper, aluminium, lead and zinc closing down an average of 0.8%, while nickel and tin were little changed. The cash/three-month spread on aluminium has also eased to $30-32 per tonne backwardation, from $50 on Tuesday morning.

Precious metals prices are weaker this morning, with the complex down an average of 0.2%. Spot gold prices are at $1,328.05 per oz. This follows a general day of weakness on Tuesday when the complex closed down an average of 0.7%, which was partially driven by a firmer US dollar index.

In wider markets, spot Brent crude oil prices are weaker by 0.52% at $64.67 per barrel and the yield on US 10-year treasuries remains firm at 2.91% as US treasury auctions are underway. On the other hand, the German 10-year bund yield has eased to 0.72%, from 0.75% on Tuesday.

Equity markets in Asia are firmer – the Nikkei is up by 0.21%, the Kospi is up 0.60%, the ASX 200 is up 0.05% and the Hang Seng is up 1.71%. This follows a mixed performance in western markets on Monday, where in the United States the Dow Jones closed down by 1.01% at 24,964.75, and in Europe where the Euro Stoxx 50 closed up by 0.8% at 3,435.08.

The dollar index’s rebound continues, being recently quoted at 89.89 – the fourth consecutive day of gains. This is applying some downward pressure on other currencies, with the euro at 1.2317, sterling at 1.3980, yen at 107.82 and the Australian dollar at 0.7845. The emerging market currencies we follow are on a back footing, which reflects the slightly firmer dollar.

The economic calendar is busy today and includes flash PMI data and the minutes of the latest FOMC meeting. Data out already from Japan shows flash manufacturing PMI dipping to 54 from 54.8 in January and all industries activity rising 0.5% in December, from 1% in November. In addition, there is employment and borrowing data out of the UK and US, initial jobless claims and existing home sales data.

Two weeks ago metals prices were selling off, last week they were rebounding and this week they are consolidating. But, with China on holiday so far this week, we are not surprised prices are rudderless, with a slight weaker bias. Today’s manufacturing PMI data may provide some direction, but overall we would expect traders to sit on the side lines until China returns to work in force, but that may not be seen until next week. We still expect dips to be remain well supported.

Another turn-around in the dollar has weighed on gold, especially as it happened when gold prices were once again challenging recent highs. Platinum is holding up relatively well, silver less so and palladium is consolidating after its latest half-hearted rebound. With the US treasury auctions underway, for now yields are likely to remain bid and that is likely to underpin the dollar and weigh on gold, but we do expect gold prices to remain well supported as concerns over higher bond yields and the impact that may have on equity and bond prices may prompt some pick-up in safe-haven buying.

Overnight Performance GMT 07:05 +/- +/- % Lots Cu 7,068 -9.0 -0.1% 551 Al 2,177 -10.5 -0.5% 646 Ni 13,570 50.0 0.4% 180 Zn 3,547 -4.0 -0.1% 316 Pb 2,580 -8.5 -0.3% 166 Sn 21,475 85.0 0.4% 3 Average BM   0.0%        1,862 Gold  1,328.05 -1.90 -0.1%   Silver        16.43 -0.03 -0.2% Platinum      996.60 -0.40 0.0% Palladium  1,029.70 -4.30 -0.4% Average PM   -0.2%

 

Economic calendar GMT Country Data Actual Expected Previous 12:30am Japan Flash Manufacturing PMI 54 55.2 54.8 4:30am Japan All Industries Activity m/m 0.5% 0.5% 1.0%  8:00am France French Flash Manufacturing PMI 58.1 58.4  8:00am France French Flash Services PMI 59.1 59.2 8:30am Germany German Flash Manufacturing PMI 60.6 61.1 8:30am Germany German Flash Services PMI 56.9 57.3 9:00am EU Flash Manufacturing PMI 59.2 59.6 9:00am EU Flash Services PMI 57.7 58 9:30am UK Average Earnings Index 3m/y 2.5% 2.5% 9:30am UK Claimant Count Change 2.3K 8.6K 9:30am UK Public Sector Net Borrowing -11.5B 1.0B 9:30am UK Unemployment Rate 4.3% 4.3% 2:15pm UK Inflation Report Hearings 2:45pm US Flash Manufacturing PMI 55.4 55.5 2:45pm US Flash Services PMI 53.8 53.3 3:00pm US Existing Home Sales 5.61M 5.57M 7:00pm US FOMC Meeting Minutes

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Categories: Metals Industry News

FORECAST: US aluminium import tariffs short-term bullish, long-term bearish for Asian premiums – sources

Tue, 02/20/2018 - 14:09

The imposition of import tariffs and/or quotas by the US government on aluminium and aluminium products could push Asian premiums up in the short term but drive them down in the long term, market participants said.

US Secretary of Commerce Wilbur Ross on Friday February 16 recommended a series of tariffs and/or quotas in addition to existing duties in place on aluminium and steel imports following the department’s Section 232 investigations into imports of the products.

US President Trump is required to make a decision on the recommendations by April 19.

“It is hard to quantify the impact on Asian premiums in the next one to two weeks, or at least until the market returns from [Chinese New Year] holidays. But there could be a knee-jerk response in the near term. If US premiums rise, Asia premiums will climb too,” a Singapore-based trader suggested.

Aluminium premiums in Asia are largely unchanged this week, with spot trading remaining slow due to the continued holiday-related absence of some industry participants. Metal Bulletin assessed the South Korean P1020 premium at $98-120 per tonne on February 20, unchanged from last week.

US aluminium premiums will rise should the US impose import tariffs and quotas on aluminium and aluminium products, market observers agree.

American Metal Market’s assessment of the P1020 premium has been rising since before Ross delivered his recommendations to the White House. The assessment on February 13 at 13-13.5 cents per lb marked an upswing of more than 40% since the start of the year.

Higher US aluminium premiums could see producers divert supply to the US, reducing supply to Asia and hence provide support for Asia premiums, a second Singapore-based trader said.

“If US premiums increase… swing tonnages will go to the US, which can lead to supply pressures in Asia,” he said.

Backwardation in foreground
But the near-term outlook for premiums in Asia is also complicated by the backwardation in nearby London Metal Exchange aluminium spreads, which could put downward pressure on premiums in the region if it persists, industry sources noted.

“The backwardation is a tough situation for traders. If the backwardation continues for another half month or longer, premiums will decrease. If the backwardation is sustained till mid-March, it could even affect Q2 MJP premiums,” a third Singapore-based trader said.

The backwardation in the February/March 2018 spread has sparked huge deliveries of the metal into LME-listed warehouses. On February 13, some 166,225 tonnes were delivered into LME system – the largest single delivery of aluminium into LME warehouses since March 19, 2014.

These deliveries briefly swung spreads back into contango but the cash/three-month spread then returned to a huge backwardation of $50 per tonne today, while the March/April 2018 spread is at a narrow contango of $0.25 per tonne.

Talks between global aluminium producers and Japanese buyers for second-quarter aluminium supply to main Japanese ports (MJP) are set to start soon, with one producer already offering $135 per tonne to some buyers in Japan.

Rising US and European aluminium premiums and expectations of strong demand during the second quarter are likely to raise the second-quarter premium from the first-quarter settlement of $103 per tonne cif.

But the backwardation is likely to cap the upside for the second-quarter MJP premium, traders have noted.

“Some material won’t be leaving the US now [due to expected higher US premiums from import tariffs]. Canada is already exporting less to Southeast Asia and Korea. Producers will latch on to [the reasons that US premiums are rising] to support their Q2 MJP offers,” the second Singapore trader said.

“But with the backwardation, traders won’t accept high premiums. Q2 MJP should increase but not significantly. $10 could be the maximum.”

Smelters will use the argument of good demand in Japan, the US and Europe to keep the second-quarter MJP premium elevated, a Korea-based trader said.

“But if the backwardation still exists in March, I don’t think the final premium can go up to $135,” he added.

Long-term view
In the mid-to-long term, market participants expect a more bearish impact on Asia aluminium premiums should the US impose import tariffs and/or quotas on the metal.

“If the US increases import tariffs on aluminium imports, China’s export of coils and products to the US will have to stop,” a second Korea-based trader said.

Should these products be redirected to Asia, it would put downward pressure on premiums in the region, he added – especially in Korea and Southeast Asia.

Offers in the region for Chinese aluminium products such as coil and plate – some of which are used as substitutes for P1020 ingots – have risen in recent months while the export arbitrage window in China has been open.

South Korea’s imports of aluminium plate, sheet and strip from China jumped 57.1% to 177,015 tonnes in 2017
. In December alone, imports from China grew 47.8% year on year to 13,278 tonnes.

Traders in Southeast Asia said earlier this month that they had received offers for Chinese aluminium plates that can be used as primary aluminium.

“If Chinese exports can’t go to the US, it will go somewhere else and the place with least resistance is Southeast Asia. Expectations of import tariffs in the US is also why the coil export chatter has been getting louder recently,” the second Singapore trader said.

Since Japanese buyers are unlikely to opt for Chinese coils as a replacement for P1020 ingots, local premiums are less likely to come under pressure, sources said.

Japan imported only 10,334 tonnes of aluminium plates, sheets and strips from China in 2017, Japanese customs data showed.

The spot cif MJP premium
 was unchanged week on week at $95-110 per tonne on February 20, according to Metal Bulletin’s assessment.

China’s exports of unwrought aluminium and aluminium products rose 4.5% to 4.79 million tonnes in 2017. In January this year, exports rose for a third consecutive month – they were up 14.3% year on year at 445,000 tonnes.

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Categories: Metals Industry News

PRICING NOTICE: Proposal to amend methodology for Aluminium P1020 cif main Japanese ports (MJP) premiums

Tue, 02/20/2018 - 09:00

Metal Bulletin proposes changes to the pricing methodology for its Aluminium P1020 cif quarterly main Japanese ports (MJP) premium and Aluminium P1020 cif MJP spot premium.

Aluminium P1020 cif quarterly main Japanese ports (MJP) premium
Metal Bulletin plans to update the methodology to include confirmed deals from at least one major consumer (instead of two consumers currently) and confirmed deals with traders. This is to reflect the increasing volumes of deals taking place between traders and producers for the settling of this benchmark. The methodology will continue to be considered settled if deals with three producers are reported to us.

Metal Bulletin tries to ensure both the buy and sell side of deals are reported to us, however, the 30,000-tonne threshold is all the total deals reported to us and not unique business.

Metal Bulletin is also reclassifying certain market participants involved in the talks such as Panasonic and Sumitomo Chemicals who were considered consumers to trading houses because a large part of their trading activity is not for their own consumption but for third-party trading.

The main overseas producers involved in the quarterly negotiations are Rio Tinto, Alcoa, South32 and Rusal. Indian and Middle Eastern producers and their material are not considered during the settling of the quarterly benchmark.

Aluminium P1020 cif spot main Japanese ports (MJP) premium
Metal Bulletin plans to increase the frequency of the assessment to twice weekly to more accurately ascertain moves in the premium taking into account deals, bid, offers, deals heard and assessments during the week. This will result in a more liquid assessment, capturing moves in the premiums twice in a week.

This would also bring the spot MJP pricing frequency, in line with the proposed changes to US Midwest premium pricing frequency, to twice-weekly.

Currently, an assessment of the spot MJP aluminium premium is produced every Tuesday. Under the adjusted methodology, the premium would be assessed every Tuesday and Friday.

Metal Bulletin is also proposing to continue pricing a spot low-high range and to stop assessing a single spot MJP assessment number.

The consultation period for these proposed amendments will end one month from the date of this pricing notice on March 20, with changes taking place from March 21.

To provide feedback on this price or if you would like to provide price information by becoming a data submitter to this price, please contact Shivani Singh by email at: pricing@metalbulletin.com. Please put ‘FAO: Shivani Singh, re: Aluminium P1020 cif  main Japanese ports (MJP) premium’ in the subject line.

To see all Metal Bulletin’s pricing methodology and specification documents go to https://www.metalbulletin.com/prices/pricing-methodology.html 

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Categories: Metals Industry News

Metals morning view: Metals prices mixed as traders adjust to high prices and thin conditions

Tue, 02/20/2018 - 08:08

The metals prices on the London Metal Exchange are mixed this morning, Tuesday February 20, with aluminium and tin prices firmer by 0.2% and 0.7% respectively, while the rest are lower by an average of 0.7%. Copper prices are down 0.6% at $7,094 per tonne.

Needless to say, with China still on holiday volumes have been light with 1,625 lots traded as of 06:57 am London time.

This follows a mixed performance on Monday, when aluminium, nickel and zinc prices were little changed, with copper, lead and tin prices off 0.6%, 0.7% and 1.7% respectively. The main development on Monday was the increased tightness in aluminium spreads that saw the cash/three-month spread move out to $50 per tonne backwardation, with most of the tightness concentrated in the cash to March date.

Precious metals prices are split between bullion and the platinum group metals (PGMs) with spot gold and silver prices down either side of 0.5% and the PGMs little changed. Spot gold was recently quoted at $1,339.61 per oz. This follows a quiet day for most of the precious metals on Monday, the exception being palladium were prices dropped 1%.

Exchanges remain closed in China for the Lunar New Year holiday and will not reopen until Thursday February 22.

In wider markets, spot Brent crude oil prices are little changed at $65.57 per barrel and the yield on US 10-year treasuries has climbed again to 2.91% and the German 10-year bund yield is firmer too at 0.75%.

Equity markets in Asia are for the most part weaker – the Nikkei is down by 1.01%, the Kospi is down 1.13%, the ASX 200 is off 0.1% and the Hang Seng is up 0.05%. This follows weakness in western markets on Monday, where in Europe the Euro Stoxx 50 closed down by 0.55% at 3,407.79.

The dollar index’s rebound continues, it was recently quoted at 89.44, this after a fresh low of 88.25 on February 16. This is applying some downward pressure on other currencies with the euro at 1.2377, sterling at 1.3968, yen at 106.88 and the Australian dollar at 0.7924. The emerging market currencies we follow are if anything on a slight back footing, which reflects the slightly firmer dollar.

Economic data out already today showed a pick-up in German PPI to 0.5% from 0.2%, later there is data on German and EU ZEW economic sentiment, EU consumer confidence, UK industrial order expectations and there is an EU Econfin meeting.

Last week’s rebounds in the base metals have paused for now but prices are for the most part poised under recent highs and look well placed to continue to rally. Needless to say with China on holiday until Thursday, trading activity may be subdued. We remain bullish overall and expect dips to remain well supported, but we need to be cautious given the broad based correction two weeks ago in case rising bond yields prompt another bout of jitters. The tightness in aluminium spreads, which comes ahead of tomorrow’s third Wednesday, combined with the large stock increases of late, are probably just to do with shorts rolling February positions and we would expect that to pass over the next few days, although the next three days of LME stocks data could still hold some surprises is shorts are going to deliver against their February shorts, rather than roll them..

A rebound in the dollar is creating a bit of a headwind for gold and silver prices, but gold generally seems in favor and the broad based sell-off from two weeks ago may be encouraging some rotation out of equities and bonds into gold. Platinum prices are looking well placed to challenge resistance above $1,000 per oz and palladium prices seem to be rebounding after their recent 15.8% correction. A stronger dollar may delay moves to the upside though.

Overnight Performance GMT 06:57 +/- +/- % Lots Cu 7,094 -44.0 -0.6% 517 Al 2,205 3.5 0.2% 447 Ni 13,545 -125.0 -0.9% 288 Zn 3,548 -19.5 -0.5% 175 Pb 2,569 -19.5 -0.8% 192 Sn 21,540 140.0 0.7% 6 Average BM   -0.3%        1,625 Gold  1,339.61 -5.74 -0.4%   Silver        16.54 -0.10 -0.6% Platinum  1,003.80 0.80 0.1% Palladium  1,030.80 -1.20 -0.1% Average PM   -0.3%

 

Economic calendar GMT Country Data Actual Expected Previous 7:00am Germany German PPI m/m 0.5% 0.3% 0.2% 10:00am Germany German ZEW Economic Sentiment 16 20.4 10:00am EU ZEW Economic Sentiment 28.4 31.8 All Day EU ECOFIN Meetings 11:00am UK CBI Industrial Order Expectations 12 14 3:00pm EU Consumer Confidence 1 1

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Categories: Metals Industry News

LME base metals prices are mostly lower in quiet trading

Tue, 02/20/2018 - 03:50

LME base metals prices were generally lower in Asian morning trading on Tuesday February 20, with Chinese markets still closed for the Lunar New Year holiday.

China’s markets will re-open on Thursday February 22.

The three-month LME copper contract on the London Metal Exchange was at $7,093 per tonne at 11:00 am Shanghai time, down 0.35% – or $25 per tonne – from yesterday’s close.

Meanwhile, the three-month aluminium also fell 0.4%, or $9, to $2,205 per tonne as of 11:00 am Shanghai time.

In response to the US Commerce Department’s recommendation that the US should impose tariffs and quotas on steel and aluminium imports from other countries, the Japan Iron and Steel Federation suggested that this violates the principles of free trade and urged the US President to make an “appropriate judgement”.

Copper prices leads the sector lower

  • Copper registered falls from yesterday after reports that Indonesia had let Freeport start shipping copper concentrates from its Grasberg mine for another year.
  • However, volumes approved were relatively limited, at only 1.2 million tonnes of concentrate over 12 months.
  • Sentiment wasn’t helped by a strong increase in inventories as stockpiles at LME warehouses rose 1.7% to their highest level since May.

Only lead up

  • The three-month lead price was up $5.50 to $2,580.50 per tonne.
  • The three-month zinc price fell $5 to $3,550 per tonne.
  • The three-month nickel price was down $35 to $13,625 per tonne.
  • The three-month tin price dropped $55 to $21,495 per tonne.

Currency moves and data releases

  • The US dollar index was up 0.11% at 89.37 at 11:00 am Shanghai time.
  • In other commodities, the Brent crude oil spot price fell 0.38% to $65.35 per barrel and the Texas light sweet crude oil spot price dipped 0.37% to $62.14 per barrel.
  • Today, Britain will release its Industrial Trends Survey, with a forecast reading of 12.
  • Also, Eurostat will flash estimates of consumer confidence.
  • In Asia, Japan will release its flash manufacturing PMI for this month, estimated to be higher at 55.2, from January’s 54.8.

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Categories: Metals Industry News

Metals morning view: Base metal prices little moved at start of week

Mon, 02/19/2018 - 09:24

The metals complex on the London Metal Exchange is down an average of 0.1%, with the exceptions of aluminium that is off 0.6% ($2,186 per tonne) and nickel that is up 0.8% ($13,775 per tonne). Copper prices are off 0.1% at $7,177 per tonne.

Volumes have been light with 2,354 lots traded as of 07:53 am London time.

This follows a mixed performance on Friday when aluminium and tin prices were up 2.1% and 0.9% respectively, nickel prices were down 3.4%, while the rest were off between 0.1% and 0.4%.

Precious metals prices are firmer with the complex up an average of 0.6%, led by a 1.1% rise in platinum prices, while gold prices are up 0.1% at $1,347.38 per tonne – this follows a day of weakness for bullion prices with gold and silver off 0.5% and 1.4%, while platinum prices were up 0.3% and palladium prices closed up 2.5%.

Exchanges remain closed in China for the Lunar New Year holiday and will not reopen until Thursday February 22.

In wider markets, spot Brent crude oil prices are up by 0.38% at $65.10 per barrel and the yield on US 10-year treasuries has eased to 2.88%, as has the German 10-year bund yield at 0.72%.

Equity markets in Asia are firmer – the Nikkei is up by 1.97%, the Kospi is up 0.87% and the ASX 200 is up by 0.64%. This follows continued rebounds in western markets on Friday, where in the United States the Dow Jones closed up by 0.08% at 25,219.38, and in Europe where the Euro Stoxx 50 closed up by 1.10% at 3,426.80.

The dollar index is rebounding, it was recently quoted at 89.14, this after a fresh low of 88.25 on February 16. This has taken the bid out of other currencies with the euro at 1.2414, sterling at 1.4017, the yen at 106.53 and the Australian dollar at 0.7927.

Economic data out today is limited – UK house prices climbed 0.8%, later there is data on the EU current account, there is a Bundesbank monthly report and Bank of England governor Mark Carney is speaking.

The rebounds in the base metals have paused for now but prices are for the most part poised under recent highs and look well placed to continue to rally. Needless to say with China on holiday until Thursday trading activity may be subdued. We remain bullish overall and expect dips to remain well supported.

A rebound in the dollar is creating a bit of a headwind for gold and silver prices, but gold generally seems in favor and the broad based sell-off from two weeks ago may be encouraging some rotation out of equities and bonds into gold. Platinum prices are looking well placed to challenge resistance above $1,000 per oz and palladium prices seem to be rebounding after their recent 15.8% correction.

Overnight Performance GMT 07:53 +/- +/- % Lots Cu 7,177 -7.0 -0.1% 629 Al 2,186 -13.5 -0.6% 1,050 Ni 13,775 105.0 0.8% 144 Zn 3,554 -12.0 -0.3% 368 Pb 2,606 -2.0 -0.1% 152 Sn 21,750 -15.0 -0.1% 11 Average BM   -0.1%         2,354 Gold   1,347.38 0.43 0.0%   Silver         16.68 0.06 0.4% Platinum   1,012.90 10.90 1.1% Palladium   1,050.10 8.10 0.8% Average PM   0.6%

 

Economic calendar GMT Country Data Actual Expected Previous 12:01am UK Rightmove HPI m/m 0.8% 0.7%  9:00am EU Current Account 30.5B 32.5B All Day EU Eurogroup Meetings 11:00am Germany German Buba Monthly Report All Day US Bank Holiday 6:45pm UK BOE Gov Carney Speaks

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Categories: Metals Industry News

LME base metals mostly down; China market shut

Mon, 02/19/2018 - 05:05

The LME aluminium price dipped 0.61% during early Asian trading on Monday February 19, reversing gains seen last Friday.

China’s markets are closed from today till Wednesday for the Chinese New Year holiday, and will re-open on Thursday February 22.

The three-month aluminium contract on the London Metal Exchange was at $2,194.50 per tonne at 12:07 pm Shanghai time, down 0.61%, or $13.50 per tonne, from Friday’s close.

Meanwhile, other base metals also fell during the session, with three-month copper down 0.65%, or $47, to $7,186 per tonne.

Aluminium price skyrockets on Section 232 recommendations 

  • Aluminium prices surged after release of US Commerce department recommendations on imports
  • One of the main recommendations made by Commerce is levying a tariff of at least 7.7% on all aluminium imports from all countries
  • China has said the bases for the proposed US tariffs are groundless and that it reserves the right to retaliate if they are imposed.
  • “If the final decision impacts China’s interests, China will certainly take necessary measures to protect its own rights,” says Wang Hejun, chief of the trade remedy and investigation bureau at China’s Ministry of Commerce.
Lead, zinc and nickel all fall, tin goes untraded
  • Lead price down $11 to $2,602 per tonne.
  • Zinc price falls $8 to $3,567 per tonne.
  • Nickel price plunges $155 to $13,765 per tonne.
  • Tin price stays unchanged at $21,750 per tonne
Currency moves and data releases 
  • The US dollar index was down 0.04 at 89.05 at 12:07 pm Shanghai time on Monday morning.
  • In other commodities, the Brent crude oil spot price rose 0.80% to $65.37 per barrel and the Texas light sweet crude oil spot price increased 1.41% to $62.47 per barrel.
  • This Wednesday, Australia will release its Q4 Wage Price Index, which is expected to rise 0.5% quarterly while annual growth is estimated to remain at 2.0%
  • This Friday, the Fed will publish minutes of its January FOMC meeting and will also deliver the text of its semi-annual monetary policy report to Congress ahead of testimonies by new Fed chair Jay Powell next week.
  • New Zealand will release its retail sales this Thursday.
  • In Europe, eyes remain on the flash February PMIs and preliminary CPI numbers.

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Categories: Metals Industry News

Aluminium prices surge after release of US Commerce Department recommendations on imports

Fri, 02/16/2018 - 22:56

The US aluminium industry is grappling with the US Commerce Department’s recommendations – confirmed by Secretary Wilbur Ross – for President Donald Trump on the Section 232 probe, with that uncertainty translating to jumps in prices and premiums.

“Everything has lit up,” one aluminium supplier quipped. “I’m getting bombarded by emails.”

American Metal Market has learned that commodity broker Marex Spectron pushed its assessment of the US Midwest aluminium premium to 14 cents per lb, up from a previous point of 12.75 cents per lb, after Commerce released its recommendations on Friday February 16.

American Metal Market’s assessment of the P1020 premium has been on the rise since before Ross delivered his recommendations to the White House last month. The latest assessment, at 13-13.5 cents per lb, marks an upswing of more than 40% since the start of the year.

And CME Group’s Midwest aluminium premium futures have skyrocketed since the announcement, with the contract for April climbing to 15 cents per lb on February 16 from 13 cents per lb on Thursday February 15.

Stocks of aluminium companies on the New York Stock Exchange jumped following Commerce’s announcement. As of Friday afternoon, stock prices for US producer Century Aluminum Co had gained 10.4% from the previous day’s close.

Meanwhile, the London Metal Exchange’s daily cash price for aluminium jumped by $25.50 on Friday to close at $2,189.50 per tonne (99.3 cents per lb), up 1.2% from $2,164 per tonne (98.1 cents per lb) on Thursday.

The three main recommendations made by Commerce to the president concerning aluminium ingots and “a wide variety of aluminum products” include:

  1. Levying a tariff of at least 7.7% on all aluminium imports from all countries;
  2. Levying a 23.6% tariff on imports from selected countries, with a quota on the rest; and
  3. Enforcing a quota on all aluminium-exporting countries without levying a tariff

More answers, more questions
The open-ended nature of these recommendations, which Ross confirmed during a press conference Friday, reportedly was by design – and is causing ripples of uncertainty in the aluminium industry.

“There’s still as many questions as there were before,” the supplier said, citing concerns as to what aluminium “products” these potential actions could affect.

“I think the market expected less,” one analyst said. “I think [the recommendations are] very aggressive. I didn’t think they were going to be this aggressive.”

Ross also confirmed during the press conference that Trump would have until April 19 to decide on which measure, if any, he will elect to enact. The president can also choose to implement remedies not included in Commerce’s recommendation, and can opt to cancel the measures at any time once enacted.

Exporters that would be subject to the 23.6% tariff include China, Hong Kong, Russia, Venezuela and Vietnam. All other countries would be limited to a quota of 100% of their total aluminium exports to the United States in 2017.

Under the third option, all countries would be subject to a quota of 86.7% of their total aluminium exports to the US in 2017.

According to Ross, the open-ended nature of Commerce’s recommendations means to tackle problems of transshipment, which has been a major issue in the aluminium industry.

“Serial offenders can evade [anti-dumping and countervailing duty] measures… that’s why the proposed [232] measures need to affect aluminum shipments from all sources, to some degree,” Ross said.

Excluding Canadian material, US imports of general unwrought aluminium totaled 2.42 million tonnes in 2017 – up 23.8% from 2016 and 108.2% higher than 2015 volumes. According to Commerce, imports have risen to account for 90% of US demand for primary aluminium, up from 66% in 2012.

Despite the willingness to implement measures affecting a host of companies, the focus still appears to be Chinese aluminium.

“My quick glance through the report suggests that… China is a target,” John Mothersole, director of research, pricing and purchasing service at London-based IHS Markit, told American Metal Market February 16. “My surprise is that remedies may be placed across a broad range of product classifications… I had thought that they might be focused on flat products and/or primary aluminum.”

Some participants optimistic

Despite the lingering questions among market participants, some who spoke to American Metal Market were supportive of what they heard.

“To me, it sounds like a reasonable approach,” a second aluminium supplier said. “We’re not supposed to be a dumping ground.”

Quotas or a combination of quotas and tariffs on select nations appear to be the most likely options for the US to implement, Cowen & Co analysts said in a February 16 research note. However, for producers, any of the three options could be beneficial.

“The remedies seem to have a goal of restarting a good block of idle primary capacity,” Mothersole said. “This is interesting, since my perception is that most of this capacity is ‘vintage’ and/or just plain obsolete. But if you are going to make the case that the industry needs protection on national security grounds, you need to maintain a foundation of primary capacity.”

Ross made the same case during the press conference: “National security is a broad and encompassing topic… it’s not just defense needs.”

According to Commerce, the goal of the measures is to bring US aluminium production up to 80% of capacity, “a level that would provide the industry with long-term viability.” The US market is currently at 48% capacity utilization.

“People with capacity to restart operations will [do so]. People on the bubble… can be shoved off of the fence and go ahead and do it,” the second supplier commented.

Some companies have been reluctant to restart smelting operations – such as Arg International’s New Madrid, Missouri, facility – due to uncompetitive electricity costs offsetting the benefit of higher aluminium prices on the LME.

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Categories: Metals Industry News

CME Group busheling contract gains seen as encouraging

Wed, 02/14/2018 - 22:01

Growing liquidity in the CME Group’s No. 1 busheling ferrous scrap futures contract is encouraging, and indicates some maturity in metals risk management, a CME executive said in an interview.

Both January and February data show increasing uptake of the contract, which is settled against American Metal Market’s Midwest index for No.1 busheling. January alone was a record month for monthly volume on the busheling futures contract, with 1,467 lots – or 29,340 gross tons – traded, Young-Jin Chang, CME Group’s global head of metals products, told American Metal market in a telephone interview on Friday February 9.

Prior records for busheling were set in May 2013, when trading volumes hit 665 lots.

“You’re seeing increasing interest in terms of the desire to manage risk” from ferrous market participants, including those with well-established interest in older hot-rolled coil (HRC) and iron ore markets, Chang said.

This busheling contract has been in place since 2013, or around five years, but it requires “a lot of education” in the marketplace to get things moving, according to Chang, who spent almost five years at David J. Joseph as a global physical trader before joining CME Group.

Certain “early adopters” of other ferrous contracts now want to see this busheling contract succeed, spurring strong interest, she said.

“So we’re seeing some more sophisticated or ‘early adopter’ types also looking at the busheling scrap contract and ways to utilize that contract,” Chang told American Metal Market.

And consequently, as liquidity improves more scrap market participants in the United States have looked to manage risk with the contract, or help fix their costs or fix busheling prices in future months, she added.

February has been another stellar month for the contract, with some 1,425 lots – or 28,500 tons – traded on February 7 alone. Open interest stood at 4,241 lots as February 12, including 1,514 lots of open interest for the March 2018 contract, according to CME Group data. March 2018 is now quoted at $380 per ton.

Nasdaq Futures Inc. and World Steel Exchange Marketing also recently launched a second ferrous scrap contract that is based on American Metal Market’s Midwest shredded scrap index. But Chang declined to comment directly on whether that launch triggered broader market interest in scrap futures.

“It’s one thing to launch a contract but it takes a lot of time to educate, build the liquidity and get market participants on board,” she said, adding that true success comes when one has “actual commercial participation” on the contract, as the CME Group has had with iron ore, HRC and now busheling.

Still, “I think there is more interest coming on board from the marketplace” broadly on ferrous futures, according to Chang, who oversees CME Group’s full suite of metals, including precious and industrial metals. She has worked within that niche since 2011.

“There’s an incredible amount of education that needs to go into ferrous [products], only because these type of tools are relatively new to the market participants,” she noted.

HRC volumes bounce higher
CME Group’s HRC contract also performed well in January, according to CME statistics sent to American Metal Market.

HRC trading volumes hit 10,435 lots last month, almost double the 2017 monthly average of 5,269 lots traded. Full-year 2017 volumes were 63,229 lots, up 17.3% from 53,884 lots the previous year.

The full-year 2017 total represents 1.26 million short tons of material, with one lot sized at 20 tons. The prior trading record for monthly HRC volumes was set in April 2016, at 8,567 lots.

In terms of options, 1,530 lots of HRC options – representing some 30,600 tons of material – were traded in 2017, Chang noted.

“Market participants are becoming more sophisticated,” she said of the progress in options use. “They see the value of risk management tools, and more adaptation is occurring.”

CME Group’s emphasis with ferrous products has always been to offer tools for commercial market participants, with investor interest and liquidity in the ferrous arena still a far cry from developed markets such as copper or gold, Chang said, noting for example that gold can trade at 450,000 lots per day for CME Group’s contract.

Still, a “little bit” of investor interest has been seen in HRC recently, with some volume contracted on screen, she said. In the past, trades were all brokerage based. That type of progress could be a “nice next step” for the busheling contract, but only once there’s a good amount of commercial participation.

Liquidity is further boosted once financial participants enter the market, which in turn is a benefit for commercial participants since they have more liquidity and tonnage to exploit – and more means for risk mitigation, Chang said.

“On ferrous specifically, our focus is very much on making sure commercial participants are getting what they need and on the continued educational process,” she said, adding that within CME Group’s busheling and HRC contracts a “vast majority” of the participation is “actual commercial hedging volume.”

That contrasts with CME Group’s copper, gold, silver, platinum and palladium contracts, where there is a “good chunk” of investor participation – even with metals that have an industrial component, such as the latter two, Chang noted.

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Categories: Metals Industry News

Metals morning view: Metals consolidate ahead of Lunar New Year holiday

Wed, 02/14/2018 - 08:45

Base metals on the London Metal Exchange are for the most part consolidating this morning, Wednesday February 14. Nickel prices are the most energetic with a 0.7% gain to $13,520 per tonne, the others are ranged between down 0.2% and up 0.3%, with copper prices unchanged at $7,017 per tonne.

Volume has been below average, with 7,611 lots traded as of 07.19 am London time.

This follows a second day of strength, with prices closing up by an average of 1.8% on Tuesday.

The precious metals are also firmer this morning with gains averaging 0.3%. Spot gold prices are up by 0.2% at $1,333.95 per oz. This follows gains of 0.7% yesterday.

On the Shanghai Futures Exchange, the base metals are up by an average of 2%, with aluminium prices bucking the trend with a 1.8% fall. LME aluminium prices managed to shake off the 166,225 tonnes of stock inflow yesterday, but it appears to have weighed on aluminium sentiment in China. Copper prices are up 1.6% at 52,710 yuan ($8,313) per tonne, while spot copper prices in Changjiang are up by 1.0% at 51,990-52,150 yuan per tonne and the LME/Shanghai copper arbitrage ratio has eased to 7.51, down from 7.54 on Tuesday.

In other metals in China, iron ore prices are up by 2.6% at 539.50 yuan per tonne on the Dalian Commodity Exchange. On the SHFE, steel rebar prices are up by 0.3%, gold prices are up by 0.9% and silver prices are up by 0.4%.

In wider markets, spot Brent crude oil prices are rebounding, up by 0.13% at $62.63 per barrel, while the yield on US 10-year treasuries is easier at 2.83%, as is the German 10-year bund yield at 0.73%.

Equities in Asia are mixed today: the Kospi is up 1.11%, the CSI 300 is up 0.80%, and the Hang Seng is up 1.71%, while the ASX 200 is down 0.25% and the Nikkei is down 0.43%. The latter is under pressure as the yen surges. This follows a mixed performance in western markets on Tuesday, where in the United States the Dow Jones closed up by 0.16% at 24,640.45, and in Europe where the Euro Stoxx 50 closed down by 0.81% at 3,340.93.

The dollar index is edging lower again, it was recently quoted at 89.59, the low being 88.43 on January 25 and the recent high being 90.57 on February 9. The euro (1.2365) is working higher, as are sterling (1.3895) and the Australian dollar (0.7872), while the yen (107.44) reached 106.84 earlier today, which was the highest since November 14. The yuan at 6.3420 is slightly weaker, while most of the other emerging currencies we follow are mixed.

The economic calendar shows China’s foreign direct investment only grew 0.3%, but this follows two months of extra strong gains of 7.9% and 9.8%, which were well above average for 2017. German fourth quarter GDP was up 0.6%, weaker than the 0.8% seen in the third quarter, and CPI dropped 0.7%, but it has a history of being negative in January. Later there is data out on Italian and EU GDP, EU industrial production with US data including CPI, retail sales, business inventories and crude oil inventories. In addition, Germany’s Bundesbank president Jens Weidmann is speaking.

After two days of rebounds LME prices are consolidating. While it does look as though the shake-out from last week may have run its course driven by dip buying, the strength of the yen suggests a pick-up in haven buying so there may still be further bouts of weakness in the broader markets that could weigh on sentiment in the metals. In addition, traders may be nervous about thinner market volumes during China’s Lunar New Year holiday that starts on Thursday and runs until February 21. We still think underlying sentiment is bullish – we should get an update on how bullish it is by seeing how much follow-through buying there is. But, it may take until after the Lunar New Year holidays before bullishness returns.

Precious metals are mapping out a similar path to the base metals i.e. they have rebounded off last week’s lows but are now consolidating. Given the yen is seeing some safe-haven demand may well help underpin/drive gold prices too.

 

Overnight Performance GMT 07:19 +/- +/- % Lots Cu 7,017 0.0 0.0% 2,531 Al 2,135 -5.0 -0.2% 1,847 Ni 13,520 95.0 0.7% 1,486 Zn 3,465 -4.0 -0.1% 1,258 Pb 2,559 8.0 0.3% 475 Sn 21,585 10.0 0.0% 14 Average BM   0.1%        7,611 Gold  1,333.95 2.25 0.2%   Silver        16.62 0.01 0.1% Platinum      977.90 4.90 0.5% Palladium      989.00 3.00 0.3% Average PM   0.3%

 

SHFE Prices 07:19 GMT RMB Change % Change Cu      52,710           830 1.6% AL      14,130 –         255 -1.8% Zn      26,640           605 2.3% Pb      19,330           355 1.9% Ni   103,000        2,680 2.7% Sn   148,770        1,920 1.3% Average change (base metals) 1.3% Rebar  3,929.00        11.00 0.3% Au      276.05          2.55 0.9% Ag  3,716.00        13.00 0.4% Iron Ore (DCE) May’18 539.5 13.5 2.6%

 

Economic calendar GMT Country Data Actual Expected Previous 3:28am China Foreign Direct Investment ytd/y 0.3% 7.9% 7:00am Germany German Prelim GDP q/q 0.6% 0.6% 0.8% 7:00am Germany German Final CPI m/m -0.7% -0.7% -0.7%  8:00am Germany German Buba President Weidmann Speaks 9:00am Italian Italian Prelim GDP q/q 0.4% 0.4% 10:00am EU Flash GDP q/q 0.6% 0.6% 10:00am EU Industrial Production m/m 0.1% 1.0% 1:30pm US CPI m/m 0.3% 0.1% 1:30pm US Core CPI m/m 0.2% 0.3% 1:30pm US Core Retail Sales m/m 0.5% 0.4% 1:30pm US Retail Sales m/m 0.2% 0.4% 2:30pm UK CB Leading Index m/m -0.2% 3:00pm US Business Inventories m/m 0.3% 0.4% 3:30pm US Crude Oil Inventories 2.8M 1.9M

 

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Categories: Metals Industry News

SHFE base metals rise ahead of New Year holiday

Wed, 02/14/2018 - 03:35

Base prices on the Shanghai Futures Exchange (SHFE) rose during Asian morning trading on Wednesday February 14, the last trading day before the Lunar New Year break.

The May nickel contract on the SHFE stood at 102,860 yuan ($16,191) per tonne as of 10.00 am Shanghai time, up by 1,990 yuan, or 2%, from the previous session’s close of 100,870 yuan per tonne.

Demand from the stainless steel sector remains strong, with world stainless steel melting production increasing 7.4% year on year in January-September 2017, the latest figures from the International Stainless Steel Forum (ISSF) show.

“Demand from Chinese steel mills, however, is expected to slow over the short-to-medium term because cost constraints will be exacerbated by environmental-related and Lunar New Year capacity closures, but this should be offset by strong demand elsewhere,” according to Metal Bulletin analyst James Moore.

The most-traded SHFE April copper contract price stood at 52,630 yuan per tonne, up 490 yuan, or 0.8%, from the previous session’s close of 52,140 yuan per tonne, after a rally in LME prices.

The three-month LME copper price continues to recoup its losses, closing yesterday $156 per tonne higher at $6,987 per tonne. The red metal has risen 3.4% so far this week.

Base metals all up

  • The SHFE March lead contract price increased by 265 yuan, or 1.4%, to 19,280 yuan per tonne.
  • The lead market remains bullish – the global lead market was in a 169,000-tonne deficit in January-November 2017, according to the latest data from the International Lead & Zinc Study Group (ILZSG).
  • The SHFE May tin contract price rose by 1,970 yuan, or 1.3%, to 148,770 yuan per tonne.
  • The SHFE April zinc contract price was up 1.2% at 26,535 yuan per tonne.
  • The SHFE April aluminium contract price increased 15 yuan, or 0.1%, to 14,395 yuan per tonne.

Currency moves and data releases

  • The dollar index decreased by 0.14% to 89.59 as of 10.37 am Shanghai time.
  • In other commodities, the Brent crude oil spot price was up by 0.24% at $62.79 per barrel.
  • In equities, the Shanghai Composite was down by 0.12% at 3,181.13.
  • In data yesterday, the UK Consumer Price Index (CPI) increased 3% year on year, higher than the forecast 2.9%, while the Producer Price Index (PPI) rose 0.7%, in line with expectations.
  • In data today, EU flash GDP and industrial production numbers are due out, while in the United States CPI, retail sales and crude oil inventories figures will be released.

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Categories: Metals Industry News

FOCUS: Metals traders’ worries mount over status of Reach after Brexit

Tue, 02/13/2018 - 16:00

Uncertainty surrounding Brexit continues to be a concern for UK metals traders from small- and medium-sized enterprises conscious that The Registration, Evaluation, Authorisation and Restriction of Chemicals (Reach) deadline is looming, Metal Bulletin learned at last week’s REACH Under The Microscope Forum.

While some traders are still unregistered and grappling with paperwork to meet the deadline of May 31, 2018, most are concerned what will happen to Reach after Brexit.

“We spent €100,000 [$122,761] on registration already. We cannot afford to spend again on a UK system,” a trader from a small metals trading firm said. “Even though we have paid for registration, we won’t get a refund on our fees and might also lose rights to the registration data.”

The UK’s Department for Environment, Food & Rural Affairs (Defra) reiterated its hard stance on Brexit at the REACH under the Microscope event in London.

The government department said it will establish a separate UK regulatory system for chemicals rather than be subject to the European Chemicals Agency’s (ECHA) chemical control system which requires every substance used or produced in Europe to be registered.

“The UK will create a UK-based platform, similar to the current REACH-IT, which will cost around £5.8 million [$8 million] and include a database of chemicals manufactured in or imported into the UK,” Simon Johnson, a member of the EU Exit Team on chemicals, pesticides and hazardous waste and environmental quality, said at the event.

The United Kingdom is scheduled to leave the European Union on March 29, 2019, less than one year after the deadline for all EU metals companies to register to Reach, although the UK will continue to comply with EU law during the transition period to the end of December 2020.

Johnson assured traders there would be no reduction in environmental standards under the UK-based platform.

“Decisions have been taken and we will ensure that existing UK institutions will continue to be recognized in the EU. That is our aim,” he added.

Johnson said the UK would look at international systems, such as the regulatory models in Switzerland and South Korea, which had arrangements in place similar to Reach.

Traders worried over costs
But small traders are concerned the move towards a UK-based regulatory system will create obstacles to their business.

“If the EU does not recognize the UK system, we will lose our ability to import,” a trader said. “If we can no longer import, we may be driven out of business.”

The loss of smaller traders could change the UK’s market share in global metals trading, leaving only larger companies competing in the international market.

While big companies already have offices in other jurisdictions in Europe to which they can transfer their Reach registrations to, smaller companies are disadvantaged.

For one, the rules state that only entities with “legal personality” (i.e. legally registered corporations) can be Reach registrants. This means companies cannot simply have a post box in another country in Europe to qualify. Also, only certain changes in legal personality of a company, such as changes in shareholders, ownership-type, absorption and asset transfer are allowed in order to transfer registration.

Moreover, there are myriad factors to consider when transferring to an EU entity.

“Registrants need to consider costs, rights to data, contractual arrangements and tax implications,” Raminta Dereskeviciute, special counsel at law firm K&L Gates, said.

She said companies should also review legitimate rights to Reach data held by UK entities.

“We are a small company and will be unable to set up offices elsewhere in Europe,” a second trader said. “I am worried I will be driven out of a job.”

“I have been speaking to many traders and the main concerns they have expressed is many of them have spent significant money and time in order to comply with the EU regulation for access to the market,” an industry source told Metal Bulletin.

“Many UK market participants have also been lead registrants in SIEFs (Substance Information Exchange Forum),” the source added. “Now do they lose that access to the database?”

Dereskeviciute said firms worried about Reach data held by UK entities should conduct a review.

“Companies should start using Brexit clauses in Reach contracts, such as letters of access and licenses to use,” Dereskeviciute said.

But another trader said he was not particularly concerned over Reach. “There is no point fretting over something that has happened yet,” he said. “The easiest thing to do would be to clone whatever is currently in place. Even if the EU does not recognize our system, I’m sure we will find ways around it.”

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Categories: Metals Industry News

FOCUS: Largest LME aluminium delivery in 4 years to swing spreads back into contango

Tue, 02/13/2018 - 14:50

Aluminium stocks on the London Metal Exchange have increased nearly 30% over the last three trading days, with market participants taking advantage of tightness in the February/March nearby spread.

Aluminium P1020A, in-warehouse Rotterdam duty-unpaid, spot low-high, $/tonne 166,225 tonnes were delivered onto the exchange today, the largest single delivery of aluminium into LME-listed warehouses since March 19, 2014.

“There is backwardation [in the February/March-2018 spread] and someone took advantage of it – when there is a backwardation people tend to deliver onto the exchange,” a trader said.

“The deliveries are linked to the February/March spread backwardation. If the spreads are tight then it does not make sense to keep hold of the metal,” a floor trader added.

Traders told Metal Bulletin that the deliveries are expected to help swing the nearby spreads back into contango.

The February/March-2018 LME spread has narrowed to a $2 per tonne contango from $5 per tonne on Friday February 9, while the benchmark cash/three-month spread has swung to a wider contango since the large delivery, now at $5.25c per tonne.

“The deliveries have an influence on the backwardation, which will disappear. It is already dwindling now,” a market source said.

“An increase in the aluminium deliveries in Asia is because of the backwardation, which has resulted in pressure to liquidate,” a second trader added.

LME aluminium stocks have increased a total 183,800 tonnes since Thursday February 8, with 41,650 tonnes delivered on Friday and 22,175 tonnes delivered on Monday before today’s large delivery.

79.8% of the stocks delivered in over these three trading days has been in Port Klang, with the rest of the metal split between Singapore and Johor – the majority of the metal is ingots.

More deliveries to come? 

On-warrant aluminium stocks in LME warehouses were at a nine-year low toward the end of 2017 having plummeted significantly after warehouse reforms in 2013 and 2015.

Although, following today’s delivery some market participants expect even more metal to be delivered to the LME.

“This could be an artificial squeeze, the tightness in March shouldn’t be there. But there are always people who purchase during the fire sale in December and are holding and waiting to deliver in February/March… There is likely to be more to come,” a third trader said.

“If it’s not just because of the backwardation and there is more to it, then we will see further deliveries over the next few weeks. Another 100,000 tonnes would not be surprising,” a warehousing source said.

“The general view is that it is being dumped there while China is on holiday – it is all Port Klang material,” a source added.

Physical traders buoyed by deliveries 
Traders and sellers on the physical market welcomed the large deliveries – viewing it as a bullish sign for premiums.

Global premiums are experiencing a bull run, but the persistent backwardation has been capping more exaggerated movements higher, with the benchmark Rotterdam duty-unpaid premium steady from the February 5 assessment at $100-107 per tonne, its highest level in a year.

“To me, this move is bullish for spreads and supportive of premiums, which is a good sign,” a trader in Europe said.

Justin Yang, Vivian Teo and Shivani Singh contributed to this article.

 

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Categories: Metals Industry News

LME prices climb higher; ali capped by huge 166,000 tonne delivery

Tue, 02/13/2018 - 10:02

Aluminium prices on the London Metal Exchange have retreated from early morning highs after a significant delivery into LME-listed warehouses in Asia caused on-warrant stock to surge by 18%.

The three-month price was trading at a high of $2,151 per tonne – a $27 per tonne increase compared to Monday’s close price – before warehouse stock data was released at 9am UK time.

Some 166,225 tonnes were delivered in this morning, 99% of which entered Port Klang. This follows 22,175 tonnes on Monday and 41,650 tonnes on Friday February 9. The three-month price is now up just $9 compared to yesterday’s close price.

“The aluminium price will continue retreat over the next few hours as people take a step back after the stock data. No doubt this has to weaken prices,” an analyst said.

“The increase in the aluminium deliveries in Asia is because of the backwardation, which has resulted in pressure to liquidate. With the LME and SHFE aluminium stocks both increasing, there could be pressure on aluminium after Chinese New Year holidays,” a trader added.

Most of the complex was trading in positive territory this morning, other than lead, with the softer dollar underpinning prices.

Copper continues to recover 
The three-month copper price was $82.50 higher than Monday’s 5pm close at $6,913.50 per tonne. Inventories dipped a net 825 tonnes to 333,025 tonnes, with 8,300 tonnes freshly cancelled.

The red metal has recovered 3% since Friday’s close price and has rallied through another support level to trade back above $6,900 per tonne.

“Only copper has posted any volume of note so far as it outperforms in both price and volumetric terms amid onshore buying and some Western short-covering encouraged by the macro stability,” Marex Spectron said.

“So long as we see the recent macro stability maintained I feel we may be in a short-term (and medium-term) ‘value zone’ for some of these metals with the US dollar looking a little tired in the immediate term. Timing as always is key but I would expect any dips to be well supported this afternoon,” it added.

Base metals prices 

  • The three-month aluminium price increased $9 to $2,133 per tonne. Stocks increased 158,925 tonnes to 1,275,500 tonnes.
  • Nickel’s three-month price was $130 higher at $13,230 per tonne. Inventories declined 2,154 tonnes to 339,006 tonnes.
  • The three-month zinc price was most recently trading at $3,416.50 per tonne, an increase of $35.50. Stocks fell 825 tonnes to 156,125 tonnes.
  • Lead’s three-month price was $10 lower at $2,506 per tonne. Stocks declined 1,125 tonnes to 122,700 tonnes.
  • The three-month tin price increased $62 to $21,160 per tonne. Inventories declined 10 tonnes to 1,925 tonnes.

Currency moves and data releases

  • The dollar index declined 0.27% to 89.85.
  • In other commodities, the Brent crude oil spot price was down 0.35% to $62.41 per barrel.
  • In data on Monday, Chinese new loans surged to a record 2.9 trillion yuan ($450.9 billion) in January – nearly five times the previous month. Meanwhile, the country’s M2 money supply also surprised to the upside with a reading of 8.6%, against an expected print of 8.2%.
  • The economic agenda is relatively light today with UK data including consumer price index (CPI), producer price index (PPI) input, retail price index, core CPI, house price index and PPI output.
  • There is also the NFIB small business index from the United States of note.
  • In addition, US Federal Open Market Committee member Loretta Mester is speaking.

 

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Categories: Metals Industry News

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